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When buying new product-buy service plan

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Reference no: EM131591162

When buying a new product, you can choose to buy a service plan that costs $39 and covers three years. If you don't buy a service plan, there is a 10% chance each year that you will need repairs to the product. The cost of repairs will be $50. If you make repairs at any time, future repairs will not be needed. Assuming an interest rate of 5% and a three year analysis period, should you choose to purchase the service plan.

Reference no: EM131591162

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